Global food ingredients company Tate & Lyle defies Covid-19 challenges to deliver strong Q3 results

UK – British-headquartered, global supplier of food and beverage ingredients Tate & Lyle has rose above the challenges of the Covid-19 pandemic to deliver an impressive 8% growth in revenue for the three months ended 31 December 2020.

The company in a statement attributed the 8% growth in revenue to a higher volume of trade, good prices, a mix management and continued growth from New Products.

North America was the company’s most profitable market delivering a double-digit revenue growth.

Tate & Lyle attributes this growth to good commercial performance, strong demand for products consumed in-home and improving demand for out-of-home consumption.

The company’s operations in Asia, Middle East, Africa and Latin America delivered high single-digit revenue growth.

This performance was attributed to strong growth in Asia Pacific, especially in China, and good mix and pricing in Latin America, mainly in Brazil. 

In Europe,- Tate & Lyle’s home ground- revenue was marginally higher than the comparative period reflecting solid demand for in-home consumption.

Sucralose, one of the company’s major products, did not enjoy the same growth, registering a decline of 3% mainly due to lower consumption of products out-of-home, particularly beverages.

Primary Products volume however increased by 4% even as sweetener volume rose to higher than the comparative period benefitting from strong operational execution, firmer demand and the phasing of some customer orders into the quarter.

In Commodities, strong revenue growth led to profit ahead of the comparative period as co-product recoveries, including from corn oil, were exceptionally strong.

Commenting on the performance, Tate & Lyle’s Chief Executive Officer Nick Hampton said: “This was a quarter of strong performance and strategic progress. Food & Beverage Solutions and Primary Products both delivered topline growth supported by excellent operational execution and cost discipline”.

In its third quarter, Tate & Lyle also announced two acquisitions to strengthen its sweetener and texturant portfolios.

The first acquisition involved an 85% stake purchase in Thailand-based tapioca ingredient manufacturer Chaodee Modified Starch for an undisclosed sum.

In the second acquisition, the British ingredients company fully acquired stevia producer Sweet Green Fields culminating a three-year long relationship that started with a distribution agreement in 2017.

For the year ending 31 March 2021, despite the continuing impact of the Covid-19 pandemic, Tate & Lyle Group expects adjusted profit before tax in constant currency is to be modestly ahead of the prior year.

The company bases its projects on continued momentum in Food & Beverage Solutions, cost discipline and significantly higher year-on-year Commodities profits. 

“While the operating environment remains uncertain and out-of-home consumption continues to be below pre-pandemic levels, the business has positive momentum.  We remain focused on delivering our priorities and are well placed to emerge from this period an even stronger business,” Hampton added.

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